---
title: "The industry chain leader submits its report: Behind CHINAHONGQIAO's net profit of 22.6 billion, the real value reassessment has just begun"
type: "News"
locale: "zh-CN"
url: "https://longbridge.com/zh-CN/news/280102310.md"
description: "CHINAHONGQIAO released its 2025 performance, with revenue of 162.354 billion yuan, a year-on-year increase of 4.0%; net profit attributable to shareholders was 22.636 billion yuan, a year-on-year increase of 1.2%. Although profit growth is not significant, through cost control and upstream and downstream integration, the gross profit per ton of the core product, electrolytic aluminum, increased by 20.1% year-on-year. The company has a unique cost buffer capability amid aluminum price fluctuations, with a net cash flow from operating activities of 42.658 billion yuan, cash reserves of 51.187 billion yuan, and a debt-to-asset ratio reduced to 42.2%"
datetime: "2026-03-23T05:23:56.000Z"
locales:
  - [zh-CN](https://longbridge.com/zh-CN/news/280102310.md)
  - [en](https://longbridge.com/en/news/280102310.md)
  - [zh-HK](https://longbridge.com/zh-HK/news/280102310.md)
---

> 支持的语言: [English](https://longbridge.com/en/news/280102310.md) | [繁體中文](https://longbridge.com/zh-HK/news/280102310.md)


# The industry chain leader submits its report: Behind CHINAHONGQIAO's net profit of 22.6 billion, the real value reassessment has just begun

##### On March 20, CHINAHONGQIAO (01378.HK) released its full-year results for 2025: revenue of 162.354 billion yuan, a year-on-year increase of 4.0%; net profit attributable to shareholders of 22.636 billion yuan, a year-on-year increase of 1.2%; basic earnings per share of 2.3842 yuan.  **A "not stunning" annual report hides an underestimated fact** At first glance, the profit only increased by 1.2%, seemingly calm. However, breaking down the numbers reveals that the quality of this report is much higher than it appears. The average price of electrolytic aluminum for the whole year of 2025 was only 18,216 yuan/ton, just about 3.8% higher than in 2024—many people mistakenly projected the soaring aluminum prices of 24,000 yuan in the first quarter of this year onto last year. In contrast, the average price of alumina plummeted by 15.2% to 2,899 yuan/ton. Amidst the rise and fall, the gross profit per ton of the company's core product, electrolytic aluminum, surged from 4,313 yuan to 5,183 yuan, a year-on-year increase of 20.1%. In other words, aluminum prices did not rise much, yet profits continued to grow, relying not on luck but on solid cost control. **Full industry chain moat: the "stabilizing force" amidst aluminum price fluctuations** The core competitiveness of CHINAHONGQIAO can be summarized in six words: upstream and downstream integration. Looking upstream, the group laid out overseas bauxite resources in its early years, with stable supply from Guinea mines and controllable raw material costs. In the midstream, alumina production capacity is sufficient, with external sales reaching 13.397 million tons in 2025, most of which is self-used to lock in internal costs. On the energy side, self-generated electricity in Shandong combined with hydropower in Yunnan has continuously increased the proportion of green electricity, and the Yunnan Hongyan project for producing 250,000 tons of high-precision aluminum alloy ingots has officially commenced production, further solidifying the green aluminum strategic framework.  This complete chain from ore to end products allows Hongqiao to have a cost buffer that is difficult for peers to replicate during aluminum price fluctuations. The decline in bauxite prices and savings in hydropower costs in 2025 effectively offset the profit erosion caused by the drop in alumina prices. The data is most convincing: net cash flow from operating activities was 42.658 billion yuan, a year-on-year increase of 8.3%; cash reserves were 51.187 billion yuan, a year-on-year increase of 14.3%; and the debt-to-asset ratio dropped to 42.2%, a decrease of 6 percentage points from the previous year. A heavy asset manufacturing enterprise earning 22.6 billion yuan annually, holding 51.2 billion yuan in cash, with a debt ratio just over 40%, is at a top level in the entire Hong Kong stock market. **Generous dividends: 65% payout ratio, nearly 5% dividend yield** The shareholder returns of Hongqiao have always been a hot topic in the market

By the end of 2025, the dividend per share will be HKD 1.65, with an annual payout ratio of approximately 65%, corresponding to a dividend yield close to 5% based on recent stock prices. At the same time, the company will spend HKD 5.58 billion to repurchase and cancel 306 million shares, creating value for shareholders with real cash. High dividends + substantial buybacks make it a benchmark in the Hong Kong stock resource sector. For long-term funds seeking stable cash returns, this itself is an extremely attractive "safety cushion." **Profit Elasticity in 2026: A Simple Arithmetic Problem** If the performance in 2025 is "stable," what truly excites about 2026 is "elasticity." The key variable is the aluminum price. The average price of electrolytic aluminum for the whole year of 2025 is about RMB 18,216 per ton (excluding VAT), while the average price in the first quarter of 2026 has soared to about RMB 24,000. Based on a production capacity of 5.82 million tons, if the average price remains around RMB 24,000 for the whole year, there will be an additional marginal profit of over RMB 3,000 per ton. After deducting an approximate 27% marginal tax rate, this means that just from electrolytic aluminum, the after-tax profit could see a significant jump. This does not even account for the cost savings from the full operation of hydropower in Yunnan, the cost reduction of new energy projects, and the favorable decline in bauxite prices. Although some may be offset by rising coal prices, the overall direction is clear— the profit release space in 2026 may far exceed the current market pricing. The "Asymmetry" of Aluminum Prices: Why Aluminum May Be the Clearest Upward Logic Currently Looking at the industry level, the supply and demand pattern of aluminum is undergoing structural changes. The supply side is highly rigid. China's electrolytic aluminum production capacity ceiling is about 45 million tons, with a production of 44.23 million tons in 2025, and the capacity utilization rate is approaching 99%, leaving very limited room for growth. Globally, high electricity prices in Europe are suppressing restarts, and new projects in Indonesia are not meeting expectations, leading to a continued tight supply overseas. Geopolitical risks amplify supply vulnerabilities. The Middle East produces about 6.8 million tons of aluminum, accounting for about 7% of global supply, and about 18% of demand in other regions excluding China. Recently, the situation between the U.S. and Iran has remained tense, and if logistics in the Strait of Hormuz are obstructed, Middle Eastern aluminum plants will only have about one month of alumina inventory available for full production. Once electrolytic aluminum reduces load, recovery takes 4-6 months. Jiangsu Securities metal analysts point out that whether in a stagflation or recovery scenario, electrolytic aluminum will benefit, and the market may initially lose 400,000 to 500,000 tons of effective supply per month, while the demand side would need a GDP downgrade of over 3% to fully offset this gap—this shock magnitude itself is already extremely extreme. The demand side is structurally improving. In 2025, China's electrolytic aluminum consumption will be 46.34 million tons, a year-on-year increase of 2.6%, with aluminum products and aluminum alloy exports accounting for 25% of the consumption structure, continuously driven by sectors such as transportation (lightweight), electronics and power (new energy), and packaging containers. The AI-driven global investment wave in power infrastructure is opening up entirely new demand growth poles for aluminum. International investment bank Goldman Sachs' judgment is even more straightforward: aluminum is currently the cleanest upward expression. Recently, Goldman Sachs stated that if production in the Middle East stops for a full month, aluminum prices will temporarily rise to **USD 3,600 per ton**; As market expectations for supply disruption extend, the forecast has been further raised. Another American investment bank, Citigroup, has raised its three-month aluminum price forecast to **$3,600 per ton**, noting that under an **optimistic scenario**, aluminum prices could rise to **$4,000 per ton**!  (Overseas media headline, screenshot source: Argus Media) The trust vote in the capital market: "milestone" in financing. In 2025, CHINAHONGQIAO has also been active in the capital market. It issued short-term financing bonds, medium-term notes, and corporate bonds totaling 12.6 billion yuan; completed two US dollar bonds totaling $600 million (of which $330 million in senior notes was oversubscribed more than 10 times, creating the lowest coupon rate for similar bonds from non-urban investment enterprises in China since February 2022); issued $300 million in convertible bonds and simultaneously repurchased, becoming the first case of "convertible bonds + repurchase" composite financing in Hong Kong stocks; completed a $1.5 billion rights issue, which was oversubscribed 7 times, with participation from several top global long-term funds. Domestic and international credit ratings have been upgraded, and financing costs continue to optimize—these are all trust votes cast by the capital market with real money. **Conclusion: An undervalued industry leader waiting for revaluation.**

##### Looking further ahead, the investment picture for CHINAHONGQIAO is becoming increasingly clear: the cost advantages of the entire industry chain build a deep moat, a low debt ratio of 42.2% and 51.2 billion in cash provide ample safety margins, a 65% payout ratio and nearly 5% dividend yield offer stable returns for holders, while the profit elasticity brought by the tailwind of aluminum prices in 2026 has not yet been fully priced by the market.

##### Coupled with the globally tight supply-demand balance in aluminum and geopolitical risk catalysts, this second-largest aluminum company in the world is standing at a starting point for accelerated profit release. Peter Lynch often said, "When buying stocks, look at future earnings, not past statements." The report card for 2025 proves CHINAHONGQIAO's ability to traverse cycles, while the story for 2026 may be the truly anticipated chapter

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